“Through no fault of the Trump administration’s they inherited a U.S. economy with a very, very low savings rate. The mistake they’re making is embracing deficit spending in a way that will take that savings rate even lower,” said Roach, formerly chairman of Morgan Stanley Asia and the firm’s chief economist for the bulk of his 30-year career at the financial giant.

The savings rate of individuals, businesses and the government sector, stripping out depreciation, fell to about 2 percent of national income late last year, Roach said. “That’s one third the average in the final three decades of the 20th century.”

U.S. stocks fell 10 percent from their record high last week, falling into correction territory for the first time in two years. The major stock indexes have recovered in the last few days, and many strategists have noted that global growth remains on an upward trend.

Economists also expect the U.S. economy to reach the government’s 3 percent target this year, after national GDP accelerated to 2.3 percent in 2017 from 1.5 percent in 2016. The latest quarter of corporate earnings reports showed the best growth in more than six years, according to Bank of America Merrill Lynch, noting that analysts and companies both expect strong earnings this year.

The only way the U.S. has been able to grow is borrowing surplus savings from other countries, running massive current account and trade deficits to attract foreign capital, Roach said. “Now we’re doing protectionism against the providers of that foreign capital.”

“We’re an accident waiting to happen here, and just by spinning a market correction, saying the fundamentals are sound, and then going down the road of deficit spending — that’s a worrisome way to run any economy, let alone our own.”